[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 2995 Introduced in Senate (IS)]
<DOC>
117th CONGRESS
1st Session
S. 2995
To improve the provision of financial literacy training and information
relating to the Blended Retirement System to members of the Armed
Forces.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
October 19, 2021
Mrs. Murray introduced the following bill; which was read twice and
referred to the Committee on Armed Services
_______________________________________________________________________
A BILL
To improve the provision of financial literacy training and information
relating to the Blended Retirement System to members of the Armed
Forces.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Re-open Enrollment for
Servicemembers to Opt-in to Updated Retirement Choice for Enduring
Security Act of 2021'' or the ``RESOURCES Act of 2021''.
SEC. 2. IMPROVEMENTS TO FINANCIAL LITERACY TRAINING; PROVISION OF
INFORMATION RELATING TO THE BLENDED RETIREMENT SYSTEM.
(a) Improvements to Financial Literacy Training.--
(1) In general.--Subsection (a) of section 992 of title 10,
United States Code, is amended--
(A) in paragraph (2)(C), by striking ``grade E-4''
and inserting ``grade E-6'';
(B) by adding at the end the following new
paragraph:
``(5) In carrying out the program to provide training under this
subsection, the Secretary concerned shall--
``(A) require the development of a standard curriculum
across all military departments for such training that--
``(i) focuses on ensuring that members of the armed
forces who receive such training develop proficiency in
financial literacy rather than focusing on completion
of training modules;
``(ii) is based on best practices in the financial
services industry, such as the use of a social learning
approach and the incorporation of elements of
behavioral economics or gamification; and
``(iii) is designed to address the needs of members
and their families;
``(B) ensure that such training--
``(i) is conducted by a financial services
counselor who is qualified as described in paragraph
(3) of subsection (b) or by other means as described in
paragraph (2)(A)(ii) of that subsection;
``(ii) is provided, to the extent practicable--
``(I) in a class held in person with fewer
than 50 attendees; or
``(II) one-on-one between the member and a
financial services counselor or a qualified
representative described in subclause (III) or
(IV) of subsection (b)(2)(A)(ii); and
``(iii) is provided using computer-based methods
only if methods described in clause (ii) are
impractical or unavailable;
``(C) ensure that--
``(i) an in-person class described in subparagraph
(B)(i)(I) is available to the spouse of a member; and
``(ii) if a spouse of a member is unable to attend
such a class in person--
``(I) training is available to the spouse
through Military OneSource; and
``(II) the member is informed during the
in-person training of the member under
subparagraph (B)(i) with respect to how the
member's spouse can access the training;
``(D) ensure that such training, and all documents and
materials provided in relation to such training, are presented
or written in manner that the Secretary determines can be
understood by the average enlisted member.''.
(2) Qualified representatives for counseling for members
and spouses.--Subsection (b)(2)(A)(ii) of such section is
amended by adding at the end the following:
``(IV) Through qualified representatives of banks
or credit unions operating on military installations
pursuant to an operating agreement with the Department
of Defense or a military department.''.
(3) Provision of retirement information.--Such section is
further amended--
(A) by redesignating subsections (d) and (e) as
subsections (e) and (g), respectively; and
(B) by inserting after subsection (c) the following
new subsection (d):
``(d) Provision of Retirement Information.--In each training under
subsection (a) and in each meeting to provide counseling under
subsection (b), a member of the armed forces shall be provided with--
``(1) all forms relating to retirement that are relevant to
the member, including with respect to the Thrift Savings Plan;
``(2) information with respect to how to find additional
information; and
``(3) contact information for counselors provided through--
``(A) the Personal Financial Counselor program, the
Personal Financial Management program, or Military
OneSource; or
``(B) nonprofit organizations or agencies that have
in effect agreements with the Department of Defense to
provide financial services counseling.''.
(4) Advisory council on financial readiness.--Such section
is further amended by inserting after subsection (e), as
redesignated by paragraph (3)(A), the following new subsection:
``(f) Advisory Council on Financial Readiness.--
``(1) Establishment.--There is established an Advisory
Council on Financial Readiness (in this section referred to as
the `Council').
``(2) Membership.--
``(A) In general.--The Council shall consist of 12
members appointed by the Secretary of Defense, as
follows:
``(i) Three shall be representatives of
military support organizations.
``(ii) Three shall be representatives of
veterans service organizations.
``(iii) Three shall be representatives of
private, nonprofit organizations with a vested
interest in education and communication of
financial education and financial services.
``(iv) Three shall be representatives of
governmental entities with a vested interest in
education and communication of financial
education and financial services.
``(B) Qualifications.--The Secretary shall appoint
members to the Council from among individuals qualified
to appraise military compensation, military retirement,
and financial literacy training.
``(C) Terms.--Members of the Council shall serve
for terms of three years, except that, of the members
first appointed--
``(i) four shall be appointed for terms of
one year;
``(ii) four shall be appointed for terms of
two years; and
``(iii) four shall be appointed for terms
of three years.
``(D) Reappointment.--A member of the Council may
be reappointed for additional terms.
``(E) Vacancies.--Any member appointed to fill a
vacancy occurring before the expiration of the term of
office for which such member's predecessor was
appointed shall be appointed only for the remainder of
such term.
``(3) Duties and functions.--The Council shall--
``(A) advise the Secretary with respect to matters
relating to the financial literacy and financial
readiness of members of the armed forces; and
``(B) submit to the Secretary recommendations with
respect to those matters.
``(4) Meetings.--
``(A) In general.--Subject to subparagraph (B), the
Council shall meet not less frequently than twice each
year and at such other times as the Secretary requests.
``(B) During election period for blended retirement
system.--During the period beginning on the date of the
enactment of the Re-open Enrollment for Servicemembers
to Opt-in to Updated Retirement Choice for Enduring
Security Act of 2021 and ending at the end of the
period provided for under section 1409(b)(4) and
12739(f) to elect to be enrolled in the Blended
Retirement System, the Council shall meet not less
frequently than every 90 days.
``(C) Quorum.--A majority of members shall
constitute a quorum and action shall be taken only by a
majority vote of the members present and voting.
``(5) Support services.--The Secretary--
``(A) shall provide to the Council an executive
secretary and such secretarial, clerical, and other
support services as the Council considers necessary to
carry out the duties of the Council; and
``(B) may request that other Federal agencies
provide statistical data, reports, and other
information that is reasonably accessible to assist the
Council in the performance of the duties of the
Council.
``(6) Compensation.--While away from their homes or regular
places of business in the performance of services for the
Council, members of the Council shall be allowed travel
expenses, including per diem in lieu of subsistence, in the
same manner as persons employed intermittently in the
Government service are allowed expenses under section 5703 of
title 5.
``(7) Annual report.--Not less frequently than annually,
the Secretary shall submit to Congress a report that--
``(A) describes each recommendation received from
the Council during the preceding year; and
``(B) includes a statement, with respect to each
such recommendation, of whether the Secretary has
implemented the recommendation and, if not, a
description of why the Secretary has not implemented
the recommendation.
``(8) Termination.--Section 14(a) of the Federal Advisory
Committee Act (5 U.S.C. App.) (relating to termination) shall
not apply to the Council.
``(9) Definitions.--In this subsection:
``(A) Military support organization.--The term
`military support organization' means an organization
that provides support to members of the armed forces
and their families with respect to education, finances,
health care, employment, and overall well-being.
``(B) Veterans service organization.--The term
`veterans service organization' means any organization
recognized by the Secretary for the representation of
veterans under section 5902 of title 38.''.
(5) Report on effectiveness of financial services
counseling.--Not later than 3 years after the date of the
enactment of this Act, the Secretary of Defense shall submit to
the congressional defense committees (as defined in section 101
of title 10, United States Code) a report on financial literacy
training and financial services counseling provided under
section 992 of title 10, United States Code, as amended by this
subsection, that assesses--
(A) the effectiveness of such training and
counseling, which shall be determined using actual
localized data similar to the Unit Risk Inventory
Survey of the Army; and
(B) whether additional training or counseling is
necessary for enlisted members of the Armed Forces or
for officers.
(b) Modifications to Lump Sum Payments of Certain Retired Pay.--
(1) Spousal consent to lump sum payment.--Subsection (b) of
section 1415 of title 10, United States Code, is amended by
adding at the end the following:
``(7) Spousal consent for election of lump sum payment.--An
eligible person who is married may not elect to receive a lump
sum payment under this subsection without the concurrence of
the person's spouse, unless the eligible person establishes to
the satisfaction of the Secretary concerned--
``(A) that the spouse's whereabouts cannot be
determined; or
``(B) that, due to exceptional circumstances,
requiring the person to seek the spouse's consent would
otherwise be inappropriate.''.
(2) Disclosures relating to offer of lump sum payment.--
Such section is further amended--
(A) by redesignating subsection (e) as subsection
(g); and
(B) by inserting after subsection (d) the following
new subsections:
``(e) Disclosures Relating to Offer of Lump Sum Payment.--
``(1) In general.--Not later than 90 days before offering
an eligible person a lump sum payment under this section, the
Secretary of Defense shall provide a notice to the person, and
the person's spouse, if married, that includes the following:
``(A) A description of the available retirement
benefit options, including--
``(i) the monthly covered retired pay that
the person would receive after the person
attains retirement age if the person is not
already receiving such pay;
``(ii) the monthly covered retired pay that
the person would receive if payments begin
immediately; and
``(iii) the amount of the lump sum payment
the person would receive if the person elects
to receive the lump sum payment.
``(B) An explanation of how the amount of the lump
sum payment was calculated, including the interest rate
and mortality assumptions used in the calculation, and
whether any additional benefits were included in the
amount.
``(C) A description of how the option to take the
lump sum payment compares to the value of the covered
retired pay the person would receive if the person
elected not to take the lump sum payment.
``(D) A statement of whether, by purchasing a
retail annuity using the lump sum payment, it would be
possible to replicate the stream of payments the person
would receive if the person elected not to take the
lump sum payment.
``(E) A description of the potential implications
of accepting the lump sum payment, including possible
benefits and reductions in such benefits, investment
risks, longevity risks, and loss of protection from
creditors.
``(F) A description of the tax implications of
accepting the lump sum payment, including rollover
options, early distribution penalties, and associated
tax liabilities.
``(G) Instructions for how to accept or reject the
offer of the lump sum payment and the date by which the
person is required to accept or reject the offer.
``(H) Contact information for the person to obtain
more information or ask questions about the option to
accept the lump sum payment, including the opportunity
for a one-on-one meeting with a counselor provided
through the Personal Financial Counselor program or the
Personal Financial Management program.
``(I) A statement that--
``(i) financial advisers (other than
financial services counselors provided through
the Personal Financial Counselor program or the
Personal Financial Management program) may not
be required to act in the best interests of the
person or the person's beneficiaries with
respect to determining whether to take the lump
sum payment; and
``(ii) if the person or a beneficiary of
the person is seeking financial advice from a
financial adviser not affiliated with the armed
forces, the person or beneficiary should obtain
written confirmation that the adviser is acting
as a fiduciary to the person or beneficiary.
``(J) Such other information as the Secretary
considers to be necessary or relevant.
``(2) Form.--The Secretary shall ensure that any notice
provided to an eligible person under paragraph (1)--
``(A) is written in manner that the Secretary
determines can be understood by the average enlisted
member of the armed forces; and
``(B) is presented in a manner that is not biased
for or against acceptance of the offer of the lump sum
payment.
``(f) Report Required.--Not later than one year after the date of
the enactment of the Re-open Enrollment for Servicemembers to Opt-in to
Updated Retirement Choice for Enduring Security Act of 2021, and
annually thereafter, the Secretary shall submit to the congressional
defense committees report that--
``(1) sets forth the number of members of the armed forces
who take a lump sum payment under this section; and
``(2) describes the details of the arrangements relating to
taking such a payment, including--
``(A) whether members have taken a lump sum payment
in exchange for reduced future benefits; and
``(B) information relating to the members who have
taken a lump sum payment, such as the age and rank of
such members.''.
(c) Additional Election Period for Blended Retirement System.--
(1) Additional election period for members of uniformed
services.--Section 1409(b)(4) of title 10, United States Code,
is amended--
(A) by striking subparagraph (A) and inserting the
following new subparagraph (A):
``(A) Reduced multiplier for full tsp members.--
``(i) In general.--Notwithstanding
paragraphs (1), (2), and (3), in the case of a
member described in clause (ii) (referred to as
a `full TSP member')--
``(I) paragraph (1)(A) shall be
applied by substituting `2' for `2\1/
2\';
``(II) clause (i) of paragraph
(3)(B) shall be applied by substituting
`60 percent' for `75 percent'; and
``(III) clause (ii)(I) of such
paragraph shall be applied by
substituting `2' for `2\1/2\'.
``(ii) Full tsp members.--A member
described in this clause is--
``(I) a member who first becomes a
member of the uniformed services on or
after January 1, 2018;
``(II) a member described in
subparagraph (B) who makes the election
described in that subparagraph; or
``(III) a member who made the
election described in subparagraph (B),
as in effect on the day before the date
of the enactment of the Re-open
Enrollment for Servicemembers to Opt-in
to Updated Retirement Choice for
Enduring Security Act of 2021.'';
(B) by striking subparagraph (B) and inserting the
following new subparagraph (B):
``(B) Election to participate in modernized
retirement system.--Pursuant to subparagraph (C), a
member of a uniformed service serving on December 31,
2017, who has served in the uniformed services for
fewer than 12 years as of the date selected by the
Secretary of Defense under subparagraph (C)(i)(I), may
elect, in exchange for the reduced multipliers
described in subparagraph (A) for purposes of
calculating the retired pay of the member, to receive
Thrift Savings Plan contributions pursuant to section
8440e(e) of title 5.'';
(C) in subparagraph (C)(i), by striking ``the
period'' and all that follows and inserting that
following: ``the period that--
``(I) begins on a date selected by
the Secretary of Defense, which--
``(aa) may be not earlier
than January 1, 2023, and not
later than January 1, 2024; and
``(bb) shall be the same as
the date selected under section
12739(f)(2)(B)(i)(I)(aa); and
``(II) ends on the date that is 180
days after the date selected under
subclause (I).'';
(D) by redesignating subparagraph (E) as
subparagraph (F); and
(E) by inserting after subparagraph (D) the
following new subparagraph (E):
``(E) Special rules relating to the second election
period.--The Secretary concerned shall--
``(i) to the extent practicable, provide to
each member described in subparagraph (B) (and
the member's spouse, if married)--
``(I) a class, to be held in person
and with fewer than 50 attendees, on
the Blended Retirement System and the
differences between that system and the
predecessor retirement system; and
``(II) financial counseling
described in section 992(b) focused on
the suitability of the Blended
Retirement System in the context of the
member's personal circumstances;
``(ii) require each such member to make the
election described in subparagraph (B) or
decline to make that election;
``(iii) document the decision of the member
under clause (ii) in a statement that describes
the features of the Blended Retirement System
and of the predecessor retirement system; and
``(iv) have the member (and the member's
spouse, if married) sign the statement
described in clause (iii) to acknowledge
understanding of those features.''.
(2) Additional election period for members of reserve
components.--Section 12739(f) of title 10, United States Code,
is amended--
(A) by striking paragraph (1) and inserting the
following new paragraph (1):
``(1) Reduced multiplier for full tsp members.--
``(A) In general.--Notwithstanding subsection (a)
or (c), in the case of a person described in
subparagraph (B) (referred to as a `full TSP member')--
``(i) subsection (a)(2) shall be applied by
substituting `2 percent' for `2\1/2\ percent';
``(ii) subparagraph (A) of subsection
(c)(2) shall be applied by substituting `60
percent' for `75 percent'; and
``(iii) subparagraph (B)(ii) of such
subsection shall be applied by substituting `2
percent' for `2\1/2\ percent'.
``(B) Full tsp members.--A person described in this
subparagraph is--
``(i) a person who first performs reserve
component service on or after January 1, 2018,
after not having performed regular or reserve
component service on or before that date;
``(ii) a person described in paragraph
(2)(A) who makes the election described in that
paragraph; or
``(iii) a person who made the election
described in paragraph (2)(A), as in effect on
the day before the date of the enactment of the
Re-open Enrollment for Servicemembers to Opt-in
to Updated Retirement Choice for Enduring
Security Act of 2021.'';
(B) in paragraph (2)--
(i) by striking subparagraph (A) and
inserting the following new subparagraph (A):
``(A) In general.--Pursuant to subparagraph (B), a
person performing reserve component service on December
31, 2017, who has performed fewer than 12 years of
service as of the date selected by the Secretary of
Defense under subparagraph (B)(i)(I) (as computed in
accordance with section 12733 of this title), may
elect, in exchange for the reduced multipliers
described in paragraph (1) for purposes of calculating
the retired pay of the person, to receive Thrift
Savings Plan contributions pursuant to section 8440e(e)
of title 5.'';
(ii) in subparagraph (B)(i), by striking
``the period'' and all that follows and
inserting that following: ``the period that--
``(I) begins on a date selected by
the Secretary of Defense, which--
``(aa) may be not earlier
than January 1, 2023, and not
later than January 1, 2024; and
``(bb) shall be the same as
the date selected under section
1409(b)(4)(C)(i)(I)(aa); and
``(II) ends on the date that is 180
days after the date selected under
subclause (I).'';
(C) by redesignating paragraph (3) as paragraph
(4); and
(D) by inserting after paragraph (2) the following
new paragraph (3):
``(3) Special rules relating second election period.--The
Secretary concerned shall--
``(A) to the extent practicable, provide to each
person described in paragraph (2)(A) (and the person's
spouse, if married)--
``(i) a class, to be held in person and
with fewer than 50 attendees, on the Blended
Retirement System and the differences between
that system and the predecessor retirement
system; and
``(ii) financial counseling described in
section 992(b) focused on the suitability of
the Blended Retirement System in the context of
the person's personal circumstances;
``(B) require each such person to make the election
described in paragraph (2)(A) or decline to make that
election;
``(C) document the decision of the member under
subparagraph (B) in a statement that describes the
features of the Blended Retirement System and of the
predecessor retirement system; and
``(D) have the member (and the member's spouse, if
married) sign the statement described in subparagraph
(C) to acknowledge understanding of those features.''.
(3) Conforming amendment.--Section 8440e(e)(1) of title 5,
United States Code, is amended--
(A) in subparagraph (A), by striking ``; or'' and
inserting a semicolon;
(B) in subparagraph (B)--
(i) in clause (ii), by striking ``has'' and
inserting ``had'';
(ii) by striking clause (iii) and inserting
the following new clause (iii):
``(iii) made the election described in
section 1409(b)(4)(B) or 12729(f)(2) of title
10, as in effect before the date of the
enactment of the Re-open Enrollment for
Servicemembers to Opt-in to Updated Retirement
Choice for Enduring Security Act of 2021, to
receive Thrift Savings Plan contributions under
this subsection in exchange for the reduced
multipliers described in section 1409(b)(4)(A)
or 12739(f)(1) of title 10, as applicable and
so in effect, for purposes of calculating the
retired pay of the member; or''; and
(C) by adding at the end the following:
``(C) who--
``(i) first entered a uniformed service
before January 1, 2018;
``(ii) has completed fewer than 12 years of
service in the uniformed services as of the
date selected by the Secretary of Defense under
sections 1409(b)(4)(C)(i)(I)(aa) and
12739(f)(2)(B)(i)(I)(aa); and
``(iii) makes the election described in
section 1409(b)(4)(B) or 12729(f)(2) of title
10 to receive Thrift Savings Plan contributions
under this subsection in exchange for the
reduced multipliers described in section
1409(b)(4)(A) or 12739(f)(1) of title 10, as
applicable, for purposes of calculating the
retired pay of the member.''.
(4) Training of certain officers.--The Secretary of Defense
shall ensure that each member of the armed forces in pay grade
E-9 or below or in pay grade O-6 or below receives training
with respect to the features of the Blended Retirement System,
without regard to whether the member is eligible to make an
election between the Blended Retirement System and the
predecessor retirement system, so that member is able to answer
the questions of other members if necessary.
(d) Report on Improved Access to Thrift Savings Plan.--Not later
than 18 months after the date of the enactment of this Act, the Federal
Retirement Thrift Investment Board shall submit to Congress a plan for
improving the access of members of the Armed Forces to information
about the Thrift Savings Plan that--
(1) takes into account the time likely to pass between the
mailing of account information to a member of the Armed Forces
and the time the member is likely to receive the information;
and
(2) makes recommendations for statutory changes necessary
to improve such access.
(e) Regulations.--The Secretary of Defense may prescribe such
regulations as are necessary to carry out the amendments made by this
section.
<all>